General Laws

Section 2. As used in this chapter the following words shall, unless the context otherwise requires have the following meanings:

“Adverse underwriting decision”, (1) any of the following actions with respect to insurance transactions involving insurance coverage which is individually underwritten:

(i) a declination of insurance coverage;

(ii) a termination of insurance coverage;

(iii) failure of an insurance representative to apply for insurance coverage with a specific insurance institution which the insurance representative represents and which is requested by an applicant; or

(iv) in the case of a life, health or disability insurance coverage, an offer to insure at higher than standard rates.

(2) Notwithstanding the provisions of clause (1), the following actions shall not be considered adverse underwriting decisions but the insurance institution or insurance representative responsible for their occurrence shall nevertheless provide the applicant or policyholder with the specific reason or reasons for their occurrence:

(i) the termination of an individual policy form on a class or statewide basis;

(ii) a declination of insurance coverage solely because such coverage is not available on a class or statewide basis; or

(iii) the rescission of a policy.

“Affiliate” or “affiliated”, a person who directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with another person.

“Applicant”, any person who seeks to contract for insurance coverage other than a person seeking group insurance that is not individually underwritten.

“Commissioner”, the commissioner of insurance or his designee.

“Consumer report”, a written, oral or other communication of information bearing on a natural person’s credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics or mode of living which is used or expected to be used in connection with an insurance transaction.

“Consumer reporting agency”, any person who:

(1) regularly engages, in whole or in part, in the practice of assembling or preparing consumer reports for a monetary fee;

(2) obtains information primarily from sources other than insurance institutions; and

(3) furnishes consumer reports to other persons.

“Control”, including the terms “controlled by” or “under common control with”, the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a commercial contract for goods or nonmanagement services, or otherwise, unless the power is the result of an official position with or corporate office held by the person.

“Declination of insurance coverage”, a denial, in whole or in part, by an insurance institution or insurance representative of requested insurance coverage.

“Individual”, any natural person who:

(1) in the case of life, health or disability insurance, is a past, present or proposed principal insured or certificate holder;

(2) is a past, present or proposed policy owner;

(3) is past or present applicant;

(4) is a past or present claimant; or

(5) derived, derives or is proposed to derive insurance coverage under an insurance policy or certificate subject to this chapter.

“Institutional source”, any person or governmental entity that provides information about an individual to an insurance representative, insurance institution or insurance-support organization, other than:

(1) an insurance representative;

(2) the individual who is the subject of the information; or

(3) a natural person acting in a personal capacity rather than in a business or professional capacity.

“Insurance institution”, any corporation, association, partnership, reciprocal exchange, inter-insurer, Lloyd’s insurer, fraternal benefit society or other person engaged in the business of insurance, including health maintenance organizations, medical service plans and hospital service plans, preferred provider arrangements and Savings Bank Life Insurance as defined in chapters one hundred and seventy-five, one hundred and seventy-six, one hundred and seventy-six A, one hundred and seventy-six B, one hundred and seventy-six C, one hundred and seventy-six G, one hundred and seventy-six I, one hundred and seventy-eight and one hundred and seventy-eight A. “Insurance institution” shall not include insurance representatives or insurance-support organizations.

“Insurance-support organization”:

(1) any person who regularly engages, in whole or in part, in the practice of assembling or collecting information about natural persons for the primary purpose of providing the information to an insurance institution or insurance representative for insurance transactions, including:

(i) the furnishing of consumer reports or investigative consumer reports to an insurance institution or insurance representative for use in connection with an insurance transaction; or

(ii) the collection of personal information from insurance institutions, insurance representatives or other insurance-support organizations for the purpose of detecting or preventing fraud or material misrepresentation in connection with insurance underwriting or insurance claim activity.

(2) Notwithstanding the provisions of subparagraph (1), the following persons shall not be considered “insurance-support organizations” for purposes of this chapter: insurance representatives, government institutions, insurance institutions, medical care institutions and medical professionals.

“Insurance representative”, an agent, broker, advisor, adjuster or other person engaged in activities described in sections one hundred and sixty-two to one hundred and seventy-seven D, inclusive, of chapter one hundred and seventy-five.

(1) the determination of an individual’s eligibility for an insurance coverage, benefit or payment; or

(2) the servicing of an insurance application, policy, contract or certificate.

“Investigative consumer report”, a consumer report or portion thereof in which information about a natural person’s character, general reputation, personal characteristics or mode of living is obtained through personal interviews with the person’s neighbors, friends, associates, acquaintances or others who may have knowledge concerning such items of information, provided; however, that it shall be unlawful for any such report to contain any information designed to determine the sexual orientation of an applicant, proposed insured, policyholder, beneficiary or any other person, or for such persons, information relating to counseling for Acquired Immune Deficiency Syndrome (AIDS) or AIDS-related Complex (ARC) as defined by the Centers for Disease Control of the United States Public Health Service. For purposes of this subsection, “counseling” shall not mean diagnosis of or treatment for AIDS or ARC.

“Medical-care institution”, any facility or institution that is licensed to provide health care services to natural persons, including but not limited to health-maintenance organizations, home-health agencies, hospitals, medical clinics, public health agencies, rehabilitation agencies and skilled nursing facilities.

(1) relates to an individual’s physical or mental condition, medical history or medical treatment; and

(2) is obtained from a medical professional or medical-care institution, from the individual, or from such individual’s spouse, parent or legal guardian;

Medical-record information shall not include information relating to counseling for Acquired Immune Deficiency Syndrome (AIDS) or AIDS-related Complex (ARC) as defined by the Centers for Disease Control of the United States Public Health Service. For purposes of this definition, “counseling” shall not mean diagnosis of or treatment for AIDS or ARC.

“Personal information”, any individually identifiable information gathered in connection with an insurance transaction from which judgments can be made about an individual’s character, habits, avocations, finances, occupation, general reputation, credit, health or any other personal characteristics. “Personal information” shall include an individual’s name and address and “medical-record information” but shall not include “privileged information”.

“Policyholder”, any person who:

(1) in the case of individual life, health or disability insurance, is a present policyholder; or

(2) in the case of group life, health or disability insurance which is individually underwritten, is a present group certificate holder.

“Pretext interview”, an interview by a person who attempts to obtain information about a natural person and who commits one or more of the following acts:

(1) relates to a claim for insurance benefits or a civil or criminal proceeding involving an individual; and

(2) is collected in connection with or in reasonable anticipation of a claim for insurance benefits or civil or criminal proceeding involving an individual; provided, however, that information otherwise meeting the requirements of this definition shall nevertheless be considered “personal information” under this chapter if it is disclosed in violation of section thirteen.

“Termination of insurance coverage” or “termination of an insurance policy”, either a cancellation or nonrenewal of an insurance policy, in whole or in part, for any reason other than the failure to pay a premium as required by the policy.

“Unauthorized insurer”, an insurer not lawfully admitted to issue policies of insurance or an annuity or pure endowment contract, except as provided in section one hundred and sixty of chapter one hundred and seventy-five.